Comments on Fadi Shaheen’s UTPR Characterization

4 Pages Posted: 4 Dec 2023 Last revised: 5 Dec 2023

See all articles by Jeffery M. Kadet

Jeffery M. Kadet

University of Washington - School of Law

Date Written: October 30, 2023

Abstract

In his article (Fadi Shaheen, “Is the UTPR a 100 Percent Tax on a Deemed Distribution?” Tax Notes Int’l, Oct. 16, 2023, p. 321 ), Fadi Shaheen floats the proposition that from a U.S. tax perspective, the UTPR is the mathematical, conceptual, and legal equivalent of a 100 percent withholding tax on a deemed distribution by the UTPR entity. In this piece, I explain why Shaheen’s analysis is flawed, meaning that the payment of UTPR to the U.S. government by a U.S. subsidiary of a foreign parent can not be characterized as a distribution with respect to stock. Rather, it is simply the payment of a tax owed by the U.S. subsidiary.

Keywords: UTPR, Pillar 2, International Taxation, Pillar Two, BEPS

JEL Classification: H21, H25, K34, E62

Suggested Citation

Kadet, Jeffery M., Comments on Fadi Shaheen’s UTPR Characterization (October 30, 2023). Available at SSRN: https://ssrn.com/abstract=4621496 or http://dx.doi.org/10.2139/ssrn.4621496

Jeffery M. Kadet (Contact Author)

University of Washington - School of Law ( email )

William H. Gates Hall
Box 353020
Seattle, WA 98105-3020
United States

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